Bermuda's oldest bank, the Bank of N.T. Butterfield, has been named the Island's top bank in 2003 by a UK-based publication.

The Banker, a magazine published in London by the Financial Times Group, reported that the bank had been chosen over its Bermuda-based peers for "its ability to perform consistently well irrespective of economic conditions (making) it the judges' favourite in Bermuda again this year."

Butterfield was also chosen as "Bank of the Year" in 2002, which was the first year that the magazine considered Bermuda banks for its awards line up.

The Banker, which has been reporting on banks since 1926, declined to say which of Butterfield's peers - with there being four banking licenses held in Bermuda - were also up for consideration for the 2003 award. But research editor Terry Baker-Self did tell The Royal Gazette that financial services companies are invited by the magazine to submit entries for consideration and there is no application fee required.

Although The Banker would not say which of the Island's other banks - the Bank of Bermuda, Bermuda Commercial Bank or Capital G Bank - had been considered for the award, the Bank of Bermuda told The Royal Gazette it had made a submission for the 2003 award.

In their line-up of 'Bank of the Year' for each country, the Bank of N.T. Butterfield came in for the following praise as Bermuda's 'bank of the year': "Despite last year's bearish equity markets and historically low interest rates, the bank boosted net profits by 35.6 percent and achieved a return on investment (ROE) of 27.1 percent, which was much higher than the average for its peers. It also posted ten percent gains in assets and Tier 1 capital for the year.

It continued: "In yet another demonstration of its capital markets expertise, in May the bank successfully completed its largest issue of sub-debt bonds aimed at North American institutional investors. The bond issue, worth $125 million, was twice oversubscribed, reflecting the investors' long-term confidence in the bank and will support the institution's future expansion."

Butterfield also got points for its technology platforms: "On the technology front, the bank has continued to upgrade its Internet banking offering and recently became the first bank in Bermuda to offer multi-currency payment services to both Bermudian and international companies," it said.

Comparing the Bank of Butterfield's returns with the Bank of Bermuda, Butterfield's 35.6 percent year-over-year gain compared to the Bank of Bermuda posting a 29.3 percent increase with net income growing in 2002 to $77.65 million. The bank's net income stood at $60 million in 2001.

Looking at each bank's ROE, Bank of Butterfield logged 27.1 percent which was cited as "much higher than...for its peers". That was true in comparison to the Bank of Bermuda with its, arguably paltry in comparison, 11.3 percent ROE in 2002.